Lenders filed fewer foreclosure notices in May, but the total number of filings was still the third-highest monthly total on record.

One of every 398 households in the United States received some kind of filing, including notices of default, scheduled auctions or bank repossession, during May. That was a decline of 6% from April but an increase of 18% compared with May 2008.

And the ultimate type of foreclosure filing – bank repossessions – increased during the month, according to RealtyTrac CEO James Saccacio.

“While defaults and scheduled foreclosure auctions were both down from the previous month, bank repossessions, or REOs, were up 2%” he said, in a prepared statement. “We expect REO activity to spike in the coming months as foreclosure delays and moratoria implemented by various state laws come to an end.”

But overall, the May statistics underscore what may be a slight improvement. The number of filings trailed off toward the end of the month, according to RealtyTrac spokesman, Rick Sharga.

“We’re still coming through a three-month period like nothing we’ve ever seen before,” he said, “with nearly a million filings in all.”

The month saw big increases of repossessed homes in several states, including Michigan, Arizona, Washington, Nevada, Oregon and New York. In Michigan alone bank repossessions went to 6,246 from 3,560 in April, a 75% increase.

The foreclosure problem is widespread but reaches plague proportions in 10 states; those hardest-hit areas account for 77% of all foreclosure filings. California had more than any other state with with 92,249 – nearly 29% of all U.S. filings.

Florida posted the nation’s second highest number at 58,931, up 50% from May 2008. Other top 10 states were Nevada (17,157), Arizona (16,865), Michigan (13,891), Ohio (11,360), Illinois (10,942), Georgia (10,516), Texas (9,813) and Virginia (5,385).

Nevada had the highest foreclosure rate with one filing for every 64 households. California, with one for every 144, and Florida, with one for every 148, were second and third respectively.

(Source: CNN)